Business owners are regularly confronted with the saying "The customer is king!" Unfortunately, not all customers behave like good kings. Some customers are like bad kings and are nothing more than bullies, crooks and tyre kickers.

One of the first things a new business owner discovers, is the fallacy of another well-known customer saying "The customer is always right!" Again, the customer is not always right. The customer does not have the right to steal from their suppliers, change contracts terms without negotiation or make false claims to avoid paying their debts.

Is the customer all powerful these days? Unfortunately, the answer is usually yes, because of four main factors.

1  Government regulations and legislation is increasing giving dodgy customers the right to avoid paying their suppliers.

2  Social media gives customers an opportunity to bully their suppliers and worse, not to be held accountable when the bully is found to be wrong.

3  The cost of Court action which even if you win, lacks the power to force the bad debtor to pay.

4  The hideous costs of Court action these days, encourages good people to allow bad people in business to get away with stealing. Rarely do you find modern business people understanding why sometimes you have to spend the money to defend your rights.

In today's business environment, knowing your customer is one of the key factors in avoiding bad customers who act like bad kings. You may complain about the costs of working out which customers are going to be good customers. However, that cost pails in to insignificance compared to the loss of money, time, and your self-esteem caused by bad customers.

If you would like to know about how to deal effectively with bad debtors, contact kim@creditmatters.com.au